Market segmentation

Market segmentation

1. DEMOGRAPHICS

   • AGE
     • The changing demographics and rapid population is affecting the age composition of the market
     • Age is not as simple as no of years been alive
       • 6 ways to classify age: CHRONOLOGICAL, BIOLOGICAL, SOCIAL, COGNITIVE, SUBJECTIVE AND PERSONAL
     • GENERATION COHORTS
       • Life cycle segmentation= a tool adopted, since consumers wants and needs adjust according to age
       • Lots of generations are present at the same time
       • Some disagreement in the literature about the labels and ranges of cohorts
       • 5 generations of cohorts:
         • OLD CONSUMER (70+) higher disposable income than all segments combined (Bond, 1997), More loyal as stick with brands (cooper, 2003) - "patronised if called young- Rena Bartos (1980) called them the "mature market"
         • BABY BOOMERS (1945-1965)- Youthful self-concept (Moschis, 2003) - good health & active= benefitted from low house prices & lack of materialism, huge changes in society growing up- politics and music
         • GEN X- (1960S-70s)- sceptical & individualistic, difficult to influence, dislike self-important, dislike marketing campaigns insulting self important
         • GEN Y (1980s- 90s) Risk takers, decreased protesting, 'cult of celebrity' (Davidson, 2003)- See an increase in following of celebrities, increased internet, interested in their life (Maslow to self-actualise and fulfil)
         • GEN Z (2000s- now) - disinterested in politics, protest a bit- materialistic, immediacy (due to technological advances), veganism, showing off status, anxiety and depression due to social media?, acceptance and high connected
     • Evaluation of age as a segment: Common & easier! Least effective as peoples behaviour doesn't correlate with age, older and more sensitive to needs and lifestyle- buying behaviour is influenced by life changing events and circumstances
   • Kotler (2005)--> demographics are the most popular when segmenting variables
   • SOCIAL CLASS
     • Definition by occupation (based on chief income earner in the household